Poland could begin gas market liberalisation in 2012 - regulator

14 June 2011 16:21  [Source: ICIS news]

LONDON (ICIS)--The Polish Energy Regulatory Office (URE) is looking at introducing Poland's long-awaited gas market liberalisation as soon as next year, the regulatory authority said on Tuesday.

The URE confirmed that it now regarded starting the liberalisation in 2012 as realistic and that it was preparing a road map for European Commission officials on achieving the market change.

Analysts note the URE is under increasing pressure from the Commission and industry lobby groups, including the Polish Chamber of the Chemical Industry (PIPC), to deregulate gas prices without undue delay.

The PIPC said it would keep up pressure for the liberalisation, particularly as deregulated gas tariffs would be vital to the success of its proposed investment project to interconnect the gas grids of Poland and Germany.

The project backed by PIPC is aimed at giving Polish chemical and other firms access to European spot market gas prices. Currently companies claim they are sometimes forced to pay severely uncompetitive fixed prices set by the Polish gas monopoly, PGNiG, which is dependent on Russia for the vast majority of its distributed gas.

However, Robert Rethy, an analyst at investment bank Wood & Company, noted that as very little infrastructure to open Poland's market to non-Russian gas was likely to be completed next year, liberalisation in 2012 would have a very limited effect on the Polish gas market.

“We believe that the current lack of infrastructure capacity – in particular, the lack of sufficient cross-border gas transit capacity, and storage capacity – effectively blocks any material competition to enter the market, even though third-party access is already available theoretically,” he said.

“Thus, [completed] infrastructure investments are likely to be needed [before a competitive gas market can be formed],” he added.

By: Will Conroy
+44 20 8652 3214

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